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House | June 17, 2014 | Committee Room | health appropriations

They'll get our subcommittee meeting started. Glad to welcome everyone
here at this bright and early hour for the Appropriations Health and
Human Services Subcommittee meeting. I'd like to introduce some Senate
pages who are serving with us this and especially welcome them here,
Quinton Beale from Raleigh. Stand up if I call your name. Quinton? To my
right, it's good to see you. You're sponsor is Senator Blue. Rachel
Figar-, Figard? Which is correct?
[SPEAKER CHANGES]
Figard.
[SPEAKER CHANGES]
Figard, I didn't even come close. She's from Davidson and Senator Tarte
is her sponsor. Jackson Carr from Dunn. Jackson, good to have you here.
His sponsor is Senator Brent Jackson. Justin Perkins from Apex. Justin
is sponsored by Senator Barringer. And Trey Jones from Tabor City. Trey
is sponsored by Senator Walters. We're glad to have these young people
with us, not only today, but for the balance of the week. Our
sergeants-at-arms present today are Steve Wilson, Donna Blake, and
Anderson Meadows and we're glad to have their assistance as always. This
meeting has been called so that we can take a look at the House
recommended budget and see what the differences are, have them explained
to us in the detail we need so that we can make some decisions as we
move forward. We've asked the staff to be prepared to brief the
differences to us and we're glad to have their able assistance and I
will thank them for all the hard work they've done thus far in getting
us to this stage in the process. First up today will be Ms. Susan Jacobs
who will start the conversation to do the comparison between the House
and Senate budget and I think paperwork has been provided for all
members so that they can follow along. Ms. Jacobs.
[SPEAKER CHANGES]
Mr. Chairman, members of the committee, good morning. Susan Jacobs,
Fiscal Research. We're going to start, you have three handouts, the
agenda, you have your comparison document, and you also have a handout
on Medicaid that Steve Owen will cover before he covers the differences
on the Medicaid budget. We'll begin with Office of the Secretary-
[SPEAKER CHANGES]
Ms. Jacobs, excuse me for one second. There's one formality I forgot if
you will forgive me. We have a new committee member here today. He came
in celebrating that, after all of his hard work trying to get on this
subcommittee, he has finally achieved his goal and I'd like to welcome
Senator Bob Rucho to the Health and Human Services subcommittee.
[SPEAKER CHANGES]
Thank you, Mr. Chairman, I'm delighted.
[SPEAKER CHANGES]
Okay, we'll begin on page G1 and the items that are in controversy are
actually shaded. So today we'll focus on those items that are different.
Of course, the first four items on page G1 are different and these are
the items that were included in each subcommittee's area regarding
salaries and benefit increases. So the first four items, of course the
first two items are the compensation increases reserves and then it's
department wide for Health and Human Services. So the amount you see
reflected here are for all the personnel within that division, I'm
sorry, within that department. The first item that we'll discuss is item
number 5, Contracts and Vacant Positions Department Wide and that is a
reduction that the Senate had included in its' budget at a 16 million
dollars recurring reduction and the House has it included in its'
budget. You see them on the same line because the description did not
change but the amount did change. The House actually funded at 50% of
the Senate reduction at 8 million dollars. The next items that are
different are on page G2 and items 10 and 11., the Competitive Block
Grant within the Office of the Secretary. The Senate included a
recurring increase to that block grant of $375,000. The House increased
the block grant by $375,000 as well, difference is in the description
and you see where we've underlined it under item 10. Where in the Senate
budget the $375,000 for the first year only and 14-15 was to be
designated for a non-profit here and

...non-profit in Wake County, Big Brothers and Big Sisters of the
Triangle. The House did not do that, and did not earmark the money for
any specific non-profit, but did agree to increase the block grant by
$375,000.
The only other item that is different in the Office of the Secretary is
on page G3. It is item number 14, supplemental short-term assistance for
group homes. You saw this item last year. It was a non-recurring
expansion item in the Office of the Secretary.
It provides funds for an additional year. Last year it was
non-recurring, this year it is non-recurring as well. For residents in
group homes who lost their eligibility for personal care services on
January the 1st.
The Senate did not include this item, so it is a House-only item and it
is funded at $2 million non-recurring.
Mr. Chair, Deborah Landry will cover the next couple of divisions and
then she'll recognize the next staff member, if that's OK.
[SPEAKER CHANGES]
Thank you very much Miss Jacobs. Miss Landry?
[SPEAKER CHANGES]
Good morning Mr. Chair, members of the committee.
We'll start on page G3, with the Division of Aging and Adult Services.
Both items are in controversy. The first item is a House-only item, and
it provides general fund appropriation for capital projects for senior
centers in the amount of $100,000 non-recurring.
The second item is Senate-only and it is a change to the Home Care and
Community Block Grant, where the Senate has a 3 percent reduction in
general fund appropriation of $969,000.
We'll move on the Division of Child Development and Early Eduction. I
would like to point out before we get started that it came to our
attention during the House budget process that there is additional TANF
emergency contingency funds.
The House had $12.6 million additional TANF funds that the Senate did
not have in preparing their budget. You'll see that in some of the
differences here.
The first item for TANF funds for pre-K is the first place you'll see
this difference. The Senate had $7.1 million non-recurring reduction of
TANF funds. The House had $15.8 because of some additional TANF
emergency funds. We'll see where the rest of that is spent later.
On page G4, item 19, the house used $49 million of lottery funds to
replace all the General Fund appropriation in pre-K. Down to 21 and 22,
there are several items that the only difference is because of the
numbering of the ?? items within the item, that the item number changed.
In this case, this is just a technical change between the item numbers,
and also a fix in the amount of funds available after we replace state
funds. It's only technical changes between the two.
Starting at the bottom of G4, items 23 and 24, and through the next
several items, the House and the Senate both make the same eligibility
changes and co-payment changes. However, implementation dates are
different, and what's done with the savings is different, so we'll go
over that a little bit.
On the childcare there's subsidy eligibility changes, items 23 and 24.
The difference there is the Senate makes the change effective September
1st. The house makes the change effective October 1st, and then provides
for the implementation of current...I'm sorry.
For individuals currently receiving childcare subsidy, the change in
eligibility would take place at their next recertification. The House
makes the change effective September 1st. I'm sorry, the Senate makes it
effective September 1st.
The House makes the change for new individuals October 1st, but for
people currently receiving, it gets phased in whenever their next
recertification is due. It would be implemented over a year's time.
That's the big difference between the money.
For the childcare subsidy co-payments set at 10 percent, the difference
is a little bit of money because of the implementation date. The House
has October 1st and the Senate has September 1st.
On Page G6, the child care subsidy co-payment no longer prorated. The
policy is the same, the difference is the implementation date. With the
Senate implementing September 1st, and the House implementing October
1st.
Those items that we just spoke about all are reinvested by both Chambers
back into the budget. However, what's done with them is a little bit
different. The Senate invests all of the money back into the Child Care
Waiting List. The House addresses the Waiting List on item 29, and if
you turn over on page G7, the top, the House implements a change in the
child care...

…rates. This provides an increase to the childcare market rates. The
last time the market rates were increased was 2007. At that time it was
only a partial change to the market rate. It didn’t bring it up to the
full market rate. This would do 40 percent of the difference between
the current market rate and what the market rate study shows. So it
does not bring it up to the full market rate. It provides for 40
percent of the difference. And that will be different for every county,
for every childcare rating system and it only does provide for 3, 4 and
5 star centers and homes, because that’s what childcare subsidy policy
only pays for 3, 4 and 5 star centers and homes. The pre-K expansion,
the difference is in the description. As I said earlier, there is an
additional can of emergency contingency funds, so the House mirrored the
Senate for the $5 million non-recurring increase but also added $4
million additional temporary assistance for needy families, emergency
contingency block grant funds. So that is the difference between the
two. On the division of social services, the difference is in the ??,
because they both take the reduction for caseloads, and it’s just a ??
description because of the next item over here on page G-8, the Senate
changes eligibility for state/county special assistance to a 100 percent
of the federal poverty level. Right now state/county special
assistance is based on the maximum payment depending where you are
living. So if you are in a special care unit, your income limit is
higher than if you are living in an adult care home, and it’s also
higher if you’re receiving in-home. The Senate made the change to
everybody at a 100 percent. There is a correction here. Because of the
grandfathering in and implementation we had an error in our spreadsheet.
The correct number is, as agreed to, is 377,977 for the first year.
The next item in controversy, at the bottom of page G-8, 39 and 40, it’s
just a technical change to the ??. The actual money items are the same,
and it’s related to the item numbers shifting between the two reports.
So, there is no real change, no real difference between those two items.
The same for the enhanced oversight of child protective services, child
welfare services and in-home services, that’s underlined so you can see
the SNAP E numbers changed. The last item I’ll point out is on page
G-11. The house included funds for work first drug testing, recurring
funds of $218,000 to pay for the drug tests and then $125,000
non-recurring for the automation to implement Session Law 2013-417,
which did provide for drug testing for work program assistance
recipients and applicants. Mr. Chair that concludes my section.
Denise Thomas will come for the next few divisions.
[SPEAKER CHANGES]
Thank you, Ms. Thomas.
[SPEAKER CHANGES]
Good morning, Denise Thomas, fiscal research. I am going to cover the
Division of Public Health and the Division of Mental Health and Public
Health starts on page 11. The first item that was in controversy is
item 54. This was a Senate only item, and it was a reduction of about
$3.5 million to the school nurse funding initiative. This would have
had eliminated about 70 positions and then targeted the remaining 166
positions to the tier 1 counties only. The House did not include this
item in their budget. Going on to page 12, items 55 and 56, the only
difference between the House and Senate is the department did come to
the House Chairs and asked to substitute one position among those 5
positions that were being eliminated, so this is a technical correction
only, a technical difference only. The next items are items 58 and 59.
Item 58 is the Senate item and this if for the $350,000 expansion
provided to the vital records unit. The Senate ?? specifies that the
expansion is for the electronic birth records systems and for other IT
needs and would go into the vital records automations funds. During the
House budget deliberations, the department submitted a request to the
House Chairs that they wanted to use this for more purposes than just
IT. They wanted to provide some temporary staffing. They wanted to
relocate some records from their primary vault to a secondary vault and
some other needs. That is the main difference. The money is the same,
but it is for different purposes that they will use the money.

Going to item 61, Onsite Water Protection. This is a Senate only item in
which the onsite water protection was being transferred from the
Environmental Health section at the Public Health over to the Department
of Natural and Economic Resources. And that was 14 positions and about
$1.2 million. That was not included in the House.
Item 63, The Food Protection Program is an House only item. This is
related to the increase you did last year in the food enlarging permit
fees which increased the receipts that the counties are getting from the
food enlarging permits. And, at that time, both, this was an arrangement
that had been agreed to by the industry, the County Commissioner’s
Association, and the department. At that time there was an oversight in
about $400,000 in the aide to county that the state had been providing
to the counties. The intent was when they received increase permit fees
that the counties would no longer need this $400,000. It would be
retained by the state program and used to provide extra technical
assistance and training to the counties’ staffs. And so, the House has
included this realignment in the DPA’s budget. There is no dollar figure
that’s attached to it that affects the bottom line. It’s just allowing
the department to keep that $400,000 instead of paying it out to the
counties.
There is one other item of difference that was left off of this report
because it was amended in the House Thursday evening and that is the
transfer of the summer food service program, which is 100% federally
funded program, that is currently in the Nutrition Services branch in
Public Health. This program would be transferred from Public Health, the
Department of Health and Human Services, over to the Department of
Public Instruction and be administered there.
The mental health section starts on page 14. The first difference is
related to item 67 and 68, and this is similar to the public health
item, and that is a technical correction only. The department submitted
a corrected information for the position number for one of those seven
positions that are being eliminated.
Item 70 is a Senate item only and that is the closure of the Wright’s
School. That was not included in the House budget.
And then the next differences start with item 72 and these are several
expansion items that were not included in the House budget. The first
item 72 is $5 million for community-based crisis services. And that was
funding a recommendation that came out of the Mental Health Subcommittee
of the Joint HHS Legislative Oversight Committee. And this was just to
provide more crisis services in the community to divert persons from
being taken to the emergency rooms or to the state-operated facilities.
Item 73 is a House item of 5.2 million non-recurring to address some of
the unpaid liabilities that the department owes to the LME MCOs.
Item 74, $750,000 nonrecurring, a House only item that provides funds
for short term case management for persons who are being released from
inpatient psychiatric facilities and other institutions.
And then the final difference is item 75, Assisted Technology, $41,000
nonrecurring, and that is to provide assisted technology for persons who
have mental and other disabilities as they transition from institutions
to community-based settings.
There was only one item in division of ?? rehab, and there was no
differences between the House and the Senate.
So, Mr. Chair, that concludes my section and Steve Owen will provide the
remaining differences.
[SPEAKER CHANGES]
Thank you, Ms. Thomas. Mr. Owen?
[SPEAKER CHANGES]
Good morning. Steve Owen, Fiscal Research. Before I get into the
numbers, what I want to do is give you some context for the detail in
how the numbers were put together. I’ll be talking primarily from the
document that’s printed in landscape. All of us, the HHS, LSBN, and
Fiscal Research, have faced data challenges in preparing these estimates
for you this year, for both the shortfall and the ??. The challenges
have been in a number of areas, but specifically the first areas of
enrollment. We still can’t tell you how many people are enrolled in
Medicaid, in which program a category they’re enrolled in, will have
data presented in a consistent manner to do any trending or analysis.
The second area’s in backlogs. We have backlogs in claims that resulted
from the implementation of the new NC track system in July that we’re
still trying to assess

...we've had application backlogs for enrollment as a result of
resources being redirected in January, as a result of the food stamps.
We're still operating two systems at the county level for enrollment.
We also have had the impact of the Health Benefit Exchanges beginning in
January that increased the number of applications that have come into
the system.
Finally, access to other data, other data that could help us understand
what's happening with trends in utilization, changes in utilization, the
impact of factors unique to this year like presumptive eligibility, like
the ACA woodwork effect. Finally, the impact or the degree to which
we've actually achieved reduction items included in the budget.
This is the area of risk in terms of the re-base for next year.
Specifically, how big are these backlogs in '14? The reason it's
important to understand or know that number, have a feeling for what
that number is, the 2015 re-base is built on the 2014 expenditures.
To the extent we don't have a sufficient amount built into that, we
won't have a sufficient amount in 2015 to actually fund expenditures.
Secondly, with that enrollment data, or other data, we really can't
assess the effect in '15 that woodwork will have in terms of
utilization, in terms of enrollment. What effect presumptive eligibility
will have. What are changes in utilization that we've seen this year
that will carry into next year?
And finally, to what degree have we achieved those reductions and how
those will affect next year's spending.
The last area of risk is how consistent is North Carolina's enrollment
and utilization, and how consistent will it be, with those trends
projected nationally. We do know that from 2003 to 2013, when we
normalized Medicaid spending in North Carolina for things like changes
in mix of enrollment, changes that the Legislature had approved for
reductions in spending.
When you normalize that, North Carolina's Medicaid spending really
trends just like the national healthcare spending. Really understanding,
or having some understanding of all of these factors is important.
None of the numbers that we're going to present, or have presented, are
going to be absolutely correct. They're all based on a series of
assumptions. I think the decision when it comes down to what degree of
risk do you want to take, in terms of next year's re-base.
The Senate chose the fiscal research worst-case scenario. The House
chose to use the basic model, the basic assumptions that the Senate used
in terms of developing a re-base, except for the biggest area of
difference was in the backlog number.
The House chose to the use the Governor's backlog instead of the backlog
that was used for the Senate's worst-case scenario.
With that, what I want to do is go through the actual numbers, beginning
on the second page. What you see here is a comparison between the House
and the Senate shortfall numbers for 2014.
As you can see, all of the numbers are basically the same. We expect in
both the House and Senate to have a cash surplus for this year of around
$41 million in Medicaid. We expect to have a cash surplus in Health
Choice for about $9.1 million.
The real difference is at the bottom, where we talk about the claim and
enrollment backlog. These are the liabilities that would be carried
forward. This is where the difference between the House and the Senate
really emerges in terms of this year's shortfall.
You can see that the Senate used an estimated total requirement backlog
of about $407 million, which produces a state liability of about $144
million. The House chose the Governor's backlog of $215 million in terms
of total requirements, which equates to $75.3 million of state.
In terms of this year's shortfall, what is expected from the House is
around a $93.9 million shortfall and the Senate's budget a $23.4 million
shortfall. Again, those numbers are critical because that's the
foundation, or the basis by which the 2015 re-base was estimated.
The third page is a comparison of the re-base for 2015. Again, from the
Senate's perspective we used the worst-case scenario for the backlogs.
We estimate in both Chambers' budgets, budget reductions that will not
be achieved of some $90 million.
In the Senate budget, we assumed an impact for presumptive eligibility
that is not assumed in the House budget. The ?? delay, which affected
this year's shortfall...

...really doesn't affect next year. Both budgets assume the impact of
children being shifted from Health Choice to Medicaid. Both budgets
assume that we will see an increase in the federal match rate for
Medicaid expenditures. For PCS services, the Senate budget assumed a
continuation of basically the spending at this current year's levels. As
you'll see when we get into the detail, the Senate budget assumed that
we would also put in a rate reduction to offset the effect of additional
hours that were recently included in a ?? in that amendment. The House
budget did not take that assumption, so there's an additional $4 million
of spending assumed in the House budget for the additional 50 hours
recipients are eligible for, effective—actually, it goes back to October
of this past year. Finally, in settlements, both chambers assumed the
same estimate. One other difference in [the] House and the Senate
budget, up in the first line—Claims, Utilization, and Growth—the House
Budget assumed the impact of a reduction of spending for the DOJ
settlement of about $6.6 million, which is blended into that number. In
terms of Health Choice, both chambers assumed the same $14.5 million
surplus. So overall, the Senate assumed a rebased need next year of
$191.5 million; the House has a rebase of $103.3 million. So that's the
major difference in terms of those two budgets.
[SPEAKER CHANGES] Did that finish your remarks?
[SPEAKER CHANGES] Before I get into the detail of the actual
differences.
[SPEAKER CHANGES] Why don't we go ahead, Senator Rucho, and let him
finish with his remarks, and then we will answer questions as they come
up afterward. I'll put you down first.
[SPEAKER CHANGES] Back to the large document, the comparison document,
beginning on page G-17. The first item that is different between the
House and the Senate is the provider assessments. Subsequent to the
submission of the Governor's budget and the approval of the Senate
budget, it was determined that one of the items of of nearly $60 million
for a provider assessment to be implemented for the LME/NCOs was not
permissible as it was presented. ?? assessments had been used in other
categories. It is permissible for managed care, but it has to be for all
managed-care plans. It cannot be focused just on Medicaid managed care,
and that was the fundamental issue. The next item included in both the
Governor's and Senate budget was mental health drug management, which
was not taken in the House budget, which would have put mental health
drugs under prior authorization. The next two items in the Senate budget
that were not included in the House budget were the changes in
eligibility standards. The first one was de-linking state-county special
assistance from Medicaid eligibility. There was also a correction in
terms of the numbers. Originally we had almost 12,000 individuals that
would have been affected. The actual number is around 5,200, and the
actual dollars would go from $28.7 [million] to $14.3 [million] if this
item were included. The next item of eligibility [is] related to the
medical needy, and this would have eliminated that as a category. The
next item of difference is on page G-18, item 84, the nursing home case
mix. What this did in the Senate budget was freeze the nursing home case
mix. The House did not take that adjustment. Item 85, related to the
average acquisition cost. Under the Affordable Care Act, it calls for a
transition for pricing of drug products from whatever basis to average
acquisition cost. What this reduction item did is, it took whatever
reduction in product costs that the state would realize, and would have
put that back into increasing dispensing fees to get those more relative
to costs up to producing a savings of $975,000 in 2015. The House did
not take that reduction. The next reduction difference is on page G-19,
86 and 87. They're the same issue, and what this does is implement a
state retention on a[n] upper payment limit supplemental plan that we
have with UNC and ECU. Currently, we actually make those supplemental
payments, which gets them from Medicaid payments up to the actual
commercial rate

...what this does is implement a portion that the state will retain of
that as they're making those payments.
In the Senate budget the percentage was 28.85%, which would have been
consistent with the change proposed for hospitals. In the House budget
that was reduced back to 25.9%, which is the current amount the state
retains from hospitals, which is also the position for hospitals that
the House took, which is in Item 88, which is the retention for
hospitals.
Again, the Senate proposed to increase the retention to 28.85%, the
House chose to leave that as it is today at 25.9% and that's why the
change back in 86 was made.
Item 89 on page G-20. There were no dollars associated with this and as
I mentioned earlier, CMS approved a state plan amendment in May of this
year that provided for changes in rate and personal care services, but
also provided for the increase of number of hours an individual could be
eligible for by 50 hours per month.
What this provision said in the Senate budget was that the rates needed
to be reduced further to compensate for any additional costs that that
would incur. The House position was that we would not reduce the rates
and so an additional $4 million in fiscal year 2015 was put into the
budget for spending relative to those additional 50 hours and that was
in their re-base.
Item 60 was to implement a single base rate for all hospital in-patient
services. Today every hospital has a different base rate in terms of the
beginning point for calculation of their in-patient payments. What this
would have done is, excluding PET and UNC, it would have created a base
rate equivalent to the state-wide median so all hospitals would start
from the state rate in terms of what they were being paid.
Item 91, again in the Senate only, not taken by the House, was a 2% rate
reduction effective January 1st of 2015, which would have applied to all
fee for service providers. It would have excluded nursing homes, it
would have excluded all cost based providers where services where the
fees were set externally, such as Part A, B and D premiums, or where the
state is required to pay costs consistent with CMS for federally
qualified health centers. It also would have excluded the LME MCO
capitation rates.
Item 92. While it is the same in both the House and Senate in terms of
verbage and intent. But the item, there was a correction to that item,
and actually the reduction is instead of $6.1 million it is actually $8
million what would be achieved through that reduction if it's taken.
Items 93 and 94. This gets back to the differences I talked about at the
very beginning in terms of the differences between the backlogs that
were selected. What these two provisions do is it recognizes the
liabilities that will be carried forward relative to those backlogs.
In the House budget, again based on the position they took with the
backlog, their liabilities carried forward would be $75.3 million. In
the Senate's budget, their backlog amount carried forward would be
$143.8 million.
Item 95 on page G-21. This is a House only item. What this does is it
changes the pricing methodology for Paragard, which is an IUD that is
exclusive for women who have hormone allergies. Currently, this is the
only contraceptive device or medication that Medicaid covers.
The pricing for this, compared to other IUD's, creates basically a
situation where physicians are losing money using this particular device
and therefore, we've seen the numbers come down consistently every year
in terms of usage.
This is a non-recurring item. The basis for non-recurring is that the
assumption is as we begin to use these we should see less pregnancies,
which should offset any costs of changing the pricing methodology for
this IUD.
Item 96 was a House item only. Now this is related to Item 85 earlier,
which was the average acquisition costs. What this does is it calls for
a study of dispensing fees at the pharmacy level.
Item 97 is a House only item, relates to nursing homes. What this does
is restores a 3% reduction that was...

Put into place in January of 2014. That reduction was consistent with
the shared savings plan that was approved in last years budget, is being
repealed in this years budget. Nursing homes were identified in the
house budget to be restored for the 3 percent that was taken and that
will be effective January of 2015. Item 98, this is the medicaid rebates
for 2015, we covered that earlier. The House chose to really dealt with
this differently. What they did was create in the reserve section 117.8
million dollar recurring reserve instead of rebates within the medicaid
budget. Item 99, which is related to item 100. In the House budget they
created a 300,000 dollar no recurring funding to support a study by
Legislative Services Commission to look at a new PCS or Personal Care
Service program, looking at the new regulations that allow some
differentiation between the different populations and their needs, as
well as looking at the procedures and processes for the inspection of
adult care homes. Item 101 on page G 23. In the Senate budget there was
funding to provide funding for consultants, contractors, and initial
staff for development of a new organization. This would actually call
for traditional medical assistance to be moved from the Department of
Health and Human Services and created as a seperate entity. The House
did not include that amount. What it did include was a million dollars
for medicaid reform. The plan or the specifics for this plan were not
specific. It provided the funding for the consultants, contractors, and
staff to create or develop this plan. In health choice the only
difference was when the House did not take the position for a single
state wide hospital base rate. That amount was affected how the health
choice budget was done in terms of reductions in the Senate budget. And
finally, there was no action taken in the divisions of services for the
blind and services for the deaf and hard of hearing. Mr. chairman that
concludes my presentation. [SPEAKER CHANGES] Thank you Mr. ??. I would
like to talk about the guidelines that we are going to adhere to today.
We're only going to have discussion on the differences between the House
budget and the Senate budget as has been outlined by our staff. And so
with that, we will open up the questions on the money part of this House
budget that we have in disagreement. We will be here until ten o'clock
at which time we will have to adjourn. We do have the room reserved for
later this afternoon so that we can come back in and look at provisions
because they're not quite ready to go with that yet is my understanding.
So with that, Senator Rucho, you are first on base. [SPEAKER CHANGES]
Thank you Mr. chairman and if i may an probably Mr. Owens since he was
the one that brought this part up. Not going into the specifics about
where the money was spent in different categories but looking at the big
picture and you did say earlier that you have been able to track the
growth on the national and on the state level, so you have some feelers
to the direction that we would expect the medicaid program to go in
regarding overall cost and I would hope at some point it would be great
that we could have a chart explaining House and Senate versions in the
last three years to better understand where and what we should expect
based on taking certain decisions. But I'll get to my question and that
is would you expect had we taken the more conservative numbers in regard
to the Senate based on re-basing and on the medicaid cost would we
minimize the risk in the next fiscal year or biennial of maybe
potentially three to five hundred million dollars of over or short fall
on the medicaid cost if we take the more conservative route would that
give us more assurances that we will not have another three to five
hundred million dollars as we've had 2 billion over the last three
years? [SPEAKER CHANGES] Go ahead Mr. Owen. [SPEAKER CHANGES] Sentator

What I can say is when we look at CMS, their actuarial services predicts
that Medicaid should grow about 5.3 percent next year. That’s what is
included in the both the House and the Senate version. Again, the
starting point is different in terms of the rebates. If you look back
over time, and again, as I said, we normalize our spending from 2003 to
2013, the national spending in that time was somewhere in that range,
and that’s really how Medicaid was going at that same time, so I think
we believe it was reasonable to put in the CMS position for forecast of
5.3 percent, which included both enrollment and utilization for the
rebates estimate. [SPEAKER CHANGES] May I follow up? [SPEAKER CHANGES]
Can we have Ms. Jacobs respond also to your question before we go
forward? [SPEAKER CHANGES] Of course. [SPEAKER CHANGES] Senator Rucho,
Senator Pate, members of the committee, we as you know over the last
year have spent a lot of time in trying to evaluate the Medicaid budget,
and in your last year’s rebates, we identified how much you needed for
growth and what the structural hole was in that budget, which was why
you had to put so much money into Medicaid last year. Two things in that
is the growth rate that you jut mentioned, we were trying to get a
handle on what is the right growth rate for the Medicaid program, making
sure that we don’t just focus on historical growth rates because those
are growth rates that have been impacted by legislative policy
decisions, so just like in revenue where Berry has a baseline for
revenue growth, we did not have that foe Medicaid, and what Steve did
was go back and try to recreate what the real baseline would have been
for Medicaid to see if we would have looked like the national growth
rate, and from the work that he’s dine that we’ve all reviewed, we
believe that North Carolina would grow like the national growth rate if
left alone. The other thing that we had to focus on was making sure that
any reductions that are included in the budget are tied to specific
policy, and that if you’re going to count on a reduction in the Medicaid
program, it has to be something that’s required to be implemented. So
those are two things that we in fiscal research have been recommending
to the General Assembly in order to make sure that you have
structurally-sound budgets moving forward, anticipating the right growth
rate and making sure that budget reductions are implemented and
associated with required changes in the program. [SPEAKER CHANGES]
Follow-up, Senator Rucho. [SPEAKER CHANGES] Yes, sir. And either Ms.
Nolan or another staff member, but I guess the bottom line question was
by using the more conservative numbers – and conservative being as far
as what liabilities we may have and the like – do we reduce the risk of
having a three to five hundred million dollar budget shortfall in the
out years? [SPEAKER CHANGES] We believe that by using the worst case,
the more conservative, it will reduce or mitigate any need for
additional funding. [SPEAKER CHANGES] Thank you, Mr. Chairman. [SPEAKER
CHANGES] Senator Barringer? [SPEAKER CHANGES] Thank you Mr. Chair, Mr.
President. In looking at this budget, it appears that the house budget
doesn’t take very many of the Senate’s Medicaid cuts, and yet they’re
spending about 135 million dollars less. Mr. Owen or Ms. Jacobs, is
there someone here that can help me reconcile how they’re not cutting
and yet they’re spending less? [SPEAKER CHANGES] Ms. Jacobs? [SPEAKER
CHANGES] Yes, Senator Barringer and members of the committee, as you
know, the overall spending by subcommittee is driven by total
availability and work that’s done at the ?? level, so those are
questions that on this subcommittee we couldn’t answer. It would have to
be answered by either Budget Development or the ?? to say what their
priorities were when they determined how much money they wanted to spend
in any specific area. So it’s determined by their overall state spending
rather than necessarily what they wanted to do in HHS. [SPEAKER CHANGES]
Follow-up? [SPEAKER CHANGES] Follow-up. [SPEAKER CHANGES] Is it safe to
say though that part of that could possibly be what Senator Rucho was
talking about, the numbers that we start from? And then because if you
start with different numbers, you’re going to end with different
numbers. Is that accurate? And Senator Hise or Senator Pate, if either
of you have anything to add about that, that would certainly be
appreciated. [SPEAKER CHANGES] Senator Hise. [SPEAKER CHANGES] I think…
I guess in saying what we’re starting with, I think it’ clear that there
are several hundred million dollars missing in the concept of when they
don’t think a liability exits in this year, so therefore they didn’t
carry forward the funds, therefore they didn’t appropriate the funds.
When you’re looking at the overall cost, that’s kind of an add in and
subtract, and that’s part of why it’s come in. The numbers that went
into the rebates, they tend to put in a reserve that was kind of held
out, and I think…

the discussion is around this. I think some incredibly weak assumptions
made, or optimistic assumptions I guess would be the best way to put
that, in what those backlogs were and claims were just to try to meet
the numbers and not have to go through the difficult decisions we made
of having to make those cuts.
[SPEAKER CHANGES]
Thank you, Senator Hise.
[SPEAKER CHANGES]
Senator McKissick.
[SPEAKER CHANGES]
Yeah, I have several questions, I guess a series of questions and I
guess I'll go to the earliest part of the money report here.
[SPEAKER CHANGES]
To whom would you address your question?
[SPEAKER CHANGES]
I suppose this section might have been reviewed by Susan, and I'm
looking at page 1G, item number 5 there where they're talking about
contracts and base positions. There's an 8 million dollar difference
between the Senate and House. Now, could you be real clear in terms of
what this covers. When it says "vacant positions" I'm clear
about that but the thing is I don't in some instances for the agency
whether these positions are unneeded or if they're vacant because
someone left recently, they need to fill them. Is there any kind of
break out that's ever come in from the agency that would support any of
this? And when it talks about contracts, that's such a broad, generic
term. Are we just saying all contracts within HHS? They just need to
reduce it by a certain number without regard to what they may be for or?
If I could could get a better feel for what this actually is covering.
[SPEAKER CHANGES]
Ms. Jacobs?
[SPEAKER CHANGES]
Yes, Senator Pate and McKissick, this item, you're right it does include
vacant positions and contracts. If you recall, in the Governor's budget
he had a 3 million dollar contract reduction that was focused on
university and, I believe, non-profit contracts. So his item was more
specific. That was 3 million dollars. We specifically looked at
positions that have been vacant for more than six month within HHS and,
as you're aware, they do have a lot of vacant positions. They used that
money for a variety of things including contracts, overtime paid in
facilities, and things like that. So it's not that they're not using the
money. The State Budget Act allows them to use that money for any
non-recurring purpose. But in this instance we were looking at, of
course, the positions vaca-, it doesn't cut all of their vacant position
money. There's over 20 million dollars associated with those positions
that have been vacant for more than six months. So it combined a
contract item with vacant positions. It allows them to be flexible on
where they want to take the reduction, from either contracts or vacant
positions department-wide and does not require that any amount come for
any specific contracts or any vacant positions. So it's a flex cut but
is limited to contracts and vacant positions only.
[SPEAKER CHANGES]
Thank you, and a couple of other questions.
[SPEAKER CHANGES]
Yes, go ahead sir.
[SPEAKER CHANGES]
I'm trying to get some idea of how these various ?? items here, which
are listed all fit together in terms of what the House is doing versus
the Senate.
[SPEAKER CHANGES]
Would you specify where you are?
[SPEAKER CHANGES]
I am looking at page G3 and of course it's on G4 and 5 and G6. A number
of related items. And, of course, I understand there's this additional
12.6 million of TANF funds that were available but I know that, on the
Senate side, we had changed some eligibility requirements that would
have affected how many, two things, first who was eligible for the
childcare subsidy and the secondly of those that were eligible there was
also provisions relating to how much they might pay moving forward. So
how have these various provisions, fitting together in this jigsaw
puzzle, change a couple of things? First the eligibility requirements,
secondly for those that are eligible how many will be paying more and
then secondly, or third, how many might eventually lose, in terms of
being provided, some type of childcare subsidy and be dropped? Because
it's not clear to me the way each of these bullets comes together and
there was also the wait list that, I guess, each entity is picking up
some people but can somebody put that patchwork together so that it's
clear?
[SPEAKER CHANGES]
Ms. Landry, could you answer that question?
[SPEAKER CHANGES]
Yes, sir. Senator McKissick, both the House and Senate make the same
eligibility changes to Childcare Subsidy. Currently the policy is 75% of
the state median income. The policy is changed to 200% of the Federal
Poverty Level for children age 0-5 and any child that has special needs.
For children age 6-12 the eligibility is now 133% or, in this budget,
would be 130%

3% of federal poverty level in each hall that is currently reserved now
without regard to income would continue to be reserved without regard to
income and those are foster care children, children reserved because of
protective services or child welfare issues. The differences between the
budgets is what happens with the savings. For the Senate all the savings
that are generated because of the change in eligibility and the
co-payments are put back into the program to address the waiting list.
For the House they fund a market rate increase and then the remaining
funds is put in to the waiting list. And then you also asked about the
number of children affected, what I can tell you is in fiscal year 12-13
there was over 110,000 different children served in childcare subsidy.
That's different from the average monthly amount of 77,000. So over the
course of a year about 110,000 different children are received. So the
information I have is based on a full year of service. So for the
children age 0-5 there would have been about 2100 children that would
not have been eligible. For the children age 6-12 there's about 9,860
children that would not have been eligible, and just 7 children age 13
and older. Now on an average monthly basis that doesn't translate to an
average monthly basis. I did ask the Division of Child Development if
they looked at their most recent data and they said the most recent data
from March would be about 7200 children that wouldn't qualify. The House
budget transitions the children off over time by having it effective for
current children at the next re-certification after October 1st. The
Senate budget changes eligibility on September 1st.
[SPEAKER CHANGES]
Follow-up, Mr. Chair, if I could.
[SPEAKER CHANGES]
Yes, go ahead, one more question.
[SPEAKER CHANGES]
Yeah, and just in connection with this item, so when you say eligibility
and you said for 0-5 2100 will not be eligible and then for another age
category there were 9800 are not be eligible, that is moving forward
with the new standards? Or if you could clarify-
[SPEAKER CHANGES]
That is correct.
[SPEAKER CHANGES]
Okay, and I guess into the House it's 7200 that would not be eligible,
is that same for both?
[SPEAKER CHANGES]
It's the same number for both it's just how long it takes. The House
implements it over a longer period of time.
[SPEAKER CHANGES]
Longer period of time.
[SPEAKER CHANGES]
Mm-hm.
[SPEAKER CHANGES]
Thank you, if you could come back to me after other questions I'd
appreciate it.
[SPEAKER CHANGES]
Thank you. Senator Barringer.
[SPEAKER CHANGES]
Thank you, Mr. Chair. This is also about that same section that we
talked about. I have some concerns about how it's being funded in the
House budget with a TANF grant, a block grant. Is there any risk in
relying on a TANF block grant for the pre-kindergarten services. That's
a federal fund, it's certainly not something that we can control.
[SPEAKER CHANGES]
Ms. Landry, could you answer that question?
[SPEAKER CHANGES]
Yes, Senator Barringer, this is the TANF availability for next year. We
do have the availability of the amount of money that the Federal
Government provides on a recurring basis plus the carry forward
availability. And this is a non-recurring swap-out. So it happens for
next year only and then the state money would come back in. General Fund
Appropriation would be replaced, would replace the block grant money in
the following year.
[SPEAKER CHANGES]
Follow-up?
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
And that, of course, would be if we chose to replace it. So this is just
using federal dollars for-
[SPEAKER CHANGES]
Ms. Landry?
[SPEAKER CHANGES]
Yes ma'am. What the non-recurring reduction, the way the state budget
act works, the way this is a non-recurring swap-out. When the Office
State Budget does the continuation budget next year they have to take
action on this and since it was non-recurring they will take out the
block grant and put back in the state dollars. Next year when you do
your budget you can make decisions on that.
[SPEAKER CHANGES]
One follow-up.
[SPEAKER CHANGES]
Ms. Jacobs would like to comment on your last question as well.
[SPEAKER CHANGES]
Senator Barringer, members of the committee, your absolutely right. If
you'll look in the, there's another part in the child development or in
social services where the state is having to actually replace TANF money
that has been lost for Child Protective Services. So any time we take
one time funds and fund a recurring need, which is something like Pre-K,
you have to then make a decision whether you want to maintain that same
level of service or only use those funds for one year to meet the need
int hat particular year. And so then it will be up to state budget and
this General Assembly how you handle it. Either they'll build it in to
the continuation budget that comes before you next year or, if not,
you'll have to evaluate if there are other recurring sources of money if
there are no TANF

funds available to maintain that level of funding. But anytime you
identify block grant funds for recurring purposes there is a risk
associated with that.
[SPEAKER CHANGES]
Thank you, and regarding the TANF block grant-
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
Oh, sorry, yes sir. And regarding the TANF block grant for this year,
has it increased? Decreased? Where does it stand for this year?
[SPEAKER CHANGES]
Ms. Landry?
[SPEAKER CHANGES]
The TANF block grant, the base block grant hasn't changed. However this
additional carry-forward money that wasn't anticipated of about 6
million dollars in the regular TANF block grant and then the TANF
Emergency Contingency block grant there's about 12 million additional
dollars.
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
And are those dollars being used here for this program, these increases
that were not anticipated?
[SPEAKER CHANGES]
Ms. Landry?
[SPEAKER CHANGES]
The Senate didn't have the additional 12 million availability when the
Senate did the budget but the House on TANF Funds for Pre-K, item 18,
used about 8 million of the additional TANF emergency funds to swap out
state dollars for federal dollars on a non-recurring basis and then use
the additional four million over on page, just a second, on page 7,
pre-k, the five million dollars non-recurring of General Fund
Appropriation item 33. The snappy also reads that there's a four million
dollars in additional TANF Emergency Contingency money and this is
non-recurring funds.
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
One follow-up.
[SPEAKER CHANGES]
Thank you. And my concern here is pre-k and how it's being funded and
funded for the future. Also I've read in here that there are lottery
funds also being used, in some regard, with pre-k which they're
unpredictable as well. Could you comment on that and then I'll yield the
floor to others.
[SPEAKER CHANGES]
Senator Barringer, the House does use 49 million of pre-k dollars for
pre-k and they-, I'm sorry, four million dollars lottery funds for
pre-k.
[SPEAKER CHANGES]
Thank you.
[SPEAKER CHANGES]
Senator Hise.
[SPEAKER CHANGES]
First question I want to get at, I want to get into, kind of get some
sense of how they came to this 215 million dollar number setting into
re-base. And, looking at claims and enrollment backlog, the two larger
areas. What sense do you have of, first of all with NCTracks and it's
legendary ability not to make payments to providers so far in this year,
what is our estimate specifically to the payments that have not yet been
made to providers or have been denied?
[SPEAKER CHANGES]
In terms of the Senate budget and the 470 million dollars, 157 million
of that was relative to the claims, about 250 was relative to the
application.
[SPEAKER CHANGES]
We have also seen in the application backlogs on the NCFast, the other
joyful IT system that we've added to this state, we've seen a large
increase in the number of claims that are coming in from the federal
exchange into that system that are processed under the new system and
even since we've completed the Senate budget there's been some reports
of the large number of claims that have come in from that system. Do you
have any sense of what we're actually seeing on those numbers?
[SPEAKER CHANGES]
We've received reports that up to 90,000 applications coming over from
the exchange have been backlogged. We've heard approval rates anywhere
from 15-20% of the ones that have been processed. What we have not been
able to get any information on is the number of applications that are
still actually pending within the DSS's and the county to be processed,
either paper applications or to be entered into the system. So at this
point we still can't assess where we are in terms of total applications.
There's no single source to get that information without surveys of the
departments.
[SPEAKER CHANGES]
Um-
[SPEAKER CHANGES]
Follow-up.
[SPEAKER CHANGES]
Follow-up. One other question I'm looking at, I know that in oversight
this year we had a lot of concern from the department and fear about how
the new ACA requirement of presumptive eligibility and what the cost was
going to be for that coming forward as well as having seen

The past few years, for example with personal care services and other
things, when you reduce the rate, somehow utilization tends to magically
increase. For example, PCS is now $18 million over this year in their
budget for what’s coming forward. But I don’t see either one of those in
the consideration of the House budget. Did those just go away?
[SPEAKER CHANGES]
The House position included in the Senate budget, part of the
assumptions when we built that was, again, the impact of presumptive
eligibility. What we did is we looked at an estimate of those areas
where presumptive eligibility would generate from, assumed a 10% error
rate. And basically what presumptive eligibility means is that hospitals
are in the position to actually say that people are eligible for
Medicaid prior to them going through the eligibility process. And what
the CMS has said is if ultimately they’re determined not to be eligible,
they will participate in the payment for those, the federal share of the
payment, but the state still has that payment for those individuals that
would not normally have had. We assumed a 10% error rate in terms of the
individuals identified in the Senate budget. The House decided they did
not want to take that position in terms of their budget based on
information they had received. In terms of the fact that you talked
about in terms of changes in utilization pattern, in preparing the
Senate, the worse case scenario we actually did try to estimate. Because
we did know when rates reduce, one option that providers have is to
change their patterns of utilization, the frequency that they see
individuals as frequency of treatment. We did include a factor in the
budget for the Senate. The House chose not to include that in their
budget.
[SPEAKER CHANGES]
Just final comment, kind of in looking at these. I think when you take a
solid look at what we know has not been paid to providers, over $150
million, when you look at the claims that aren’t processed, as well as
the applications that then aren’t processed from the county, I think we
also know that we have a risk that a lot of these are held at counties
right now. We saw that happen with food stamps. Suddenly several
thousand appeared under somebody’s desk at the last moment that’s coming
through. I think that the $407 million assumption that comes into place
for. Now, that’s both federal and state, becomes to about 140 million in
state rebates and others is a conservative assumption. I think if you’re
going to try to say that automatically we’re just going to puff that
number down to 215 and see where the governor came in and where the
House has hopefully tried to land, I think that is a guarantee for this
state that we approach a $200 to $300 million shortfall coming into next
long session.
[SPEAKER CHANGES]
Like to interrupt for just a second. Those of you in the gallery who are
standing, we’d invite you to come forward and sit on the back row.
There’s some comfy seats available. We’re going to be in here about 10
more minutes if there’s questions to suffice. So, please feel free to
come up to the back row just across the bar.
Further questions from members of the committee. Senator McKissick.
[SPEAKER CHANGES]
Sure. A couple of additional questions. I was interested in, and this is
the item that’s on page 20 G, dealing with the single base rate for
hospitals. I know what the Senate had recommended in terms of coming up
with a single base rate. Is the House basically saying they want to keep
it the way it is at this time with no change or no amendment whatsoever?
It wasn’t clear to me.
[SPEAKER CHANGES]
Mr. Owen.
[SPEAKER CHANGES]
Senator McKissick, what the House proposed was a study of regional rates
for hospitals. So, rather than directing the implementation of a single
median or statewide rate, they chose the study. As you may recall, in
last year’s budget there was a provision that called for regional rates,
so the House took the position of those study.
[SPEAKER CHANGES]
Thank you ??
[SPEAKER CHANGES]
Additional follow-up.
[SPEAKER CHANGES]
Could we have Senator Hise’s question, then we’ll come back to you.
[SPEAKER CHANGES]
Let me just add on that issue to follow-up. State law currently requires
regional base rates. I know we talked about every hospital having its
own base rate. But the law we already have requires us to go to four
base rates. Our proposal took us from four to one. So, we’re going to
study something that’s required by law

to be implemented.
[SPEAKER CHANGES]
Last year's budget included a provision to implement a regional base
rate system for hospitals, that's true.
[SPEAKER CHANGES]
Senator McKissick, do you have a follow-up?
[SPEAKER CHANGES]
Sure. As I recall the regional rates were proposed last year but we
didn't move forward with them because it came up as an amendment on the
floor of the Senate at one time but we can deal with that later, I
suppose.
[SPEAKER CHANGES]
What came up on the floor of the Senate last year was to move to a state
rate from the proposed regional rates. Regional rates were passed as
part of the budget last year.
[SPEAKER CHANGES]
Mr. Blackledge, could you add to the information?
[SPEAKER CHANGES]
Ryan Blackledge, Legislative Drafting. Senator, we'll get a closer look
at last year's special provision because the House changed last year's
to change it from a required regional base rate to the study. It is
currently state law that the department was supposed to develop those
regional rates however they came before HHS Oversight and said,
"well, there wasn't a due date on that provision so we're not going
to get to it until we do all the things with due dates specified."
So they, state law requires the development of those rates but they were
never developed.
[SPEAKER CHANGES]
That's what I was thinking, along those lines. Let me move back to this-
[SPEAKER CHANGES]
Do you have a follow-up?
[SPEAKER CHANGES]
Yeah, follow-up, but it's dealing with the Medicaid at this point in
time. I guess Steve, you'd be the best person to ask. In terms of the
backlog of Medicaid claims at this time that are pending and I'm talking
about ones that are either in the process of, have either been denied or
those that are pending, what kind of percentage rates that you assume,
say for denied claims, would subsequently be approved? And of ones that
are pending what kind of assumptions were made relating to approval
rates? If you could share with me whatever thoughts you had when you
were doing those type of computations.
[SPEAKER CHANGES]
Mr. ??
[SPEAKER CHANGES]
Senator McKissick, in terms of denied and pending claims the assumption
were those, a denied claim has been denied and we didn't make any
assumption that those would be re-approved. What we looked at is the
average spending using spending from a steady state of April, May, and
June of last year on a per member per month basis by program A, category
to project. The spending we thought we should be incurring compared to
what we actually are incurring to actually create an estimate of what's
the variation there. We also had information from the department that
there were over 11,000 different tickets from providers that could not
get claims in. So these, the number that we're trying to estimate of the
claims that can't even get into the system to be denied or to be pended.
These are claims that just cannot even get in to be processed. So based
on user looking at spending data compared to where we thought we should
be spending based on ??, looking at the information we got from the
department on the number of tickets that were outstanding, as well as
based on conversations with associations in terms of that's more
anecdotal. We tried to put an estimate but hard number was really based
on actual spending compared to spending in previous periods.
[SPEAKER CHANGES]
Last follow-up, Mr. Chair, if I could.
[SPEAKER CHANGES]
Last follow-up, Senator McKissick.
[SPEAKER CHANGES]
So what you're saying, for those that were denied, there was no
assumption about those that might be subsequently approved. The thing
that gives me a little trouble and heartburn with are all the problems
that we had with NCTracks. I know that in my district I got a small
medical center and a big one. I got Duke and I got Granville, Granville
Health Systems. The amount of claims that were declined based upon these
taxonomy code issues that were subsequently approved were rather
substantial. We're talking about, at one point, 15 million were being
denied. In the end I think all of those things got approved except for
two million, in one specific instance I'm aware of. And even those they
were still working on because of problems with the system. So when I
hear that there was nothing built in for subsequently approved claims
that might have fallen into those categories, we are hoping the issues
with NCTracks that resulted in extraordinary rates of declines have all
been resolved but I get a little bit of heartburn when I hear that
there's no factor being built in to the equation to take into account
that we may have, continue to have some problems and challenges with
claims that should perhaps have been properly processed being initially
declined but subsequently approved when additional data is provided by
the Medicaid providers. It's not just hospitals, it's other entities as
well that have experienced those problems rather substantial

Can you help me with that a little?
[SPEAKER CHANGES]
Still on?
In doing I guess when the Center budget was prepared
We were looking at spending through March so in terms to the extent, the
claims that you mentioned had been processed at that point. They're in
the base and they would have been within the speeding and would have
adjust to the number
that I did. I think the item that you are referring to actually argues
more for the cautious if you will, rebates or back log numbers.
Again since we really can't get hard-data on what's not in the system
the information about whats denied and subsequently approved,
the assumption was that these items had been largely
cleaned up by the end of March to extent they're not.
With also argue with a higher back log number
[SPEAKER CHANGES]
Thank you Sir
Senator Barringer
[SPEAKER CHANGES]
Thank you.
This is just a follow up comment to what Senator heist has discussed and
also my colleague Senator McKissick.
I continue to get numerous calls I think we're aware of the hospital
back log and their concerns but the medical equipment company is
suffering as well in a great way i think that's just another indicator
that we have to be cautious in these rebate numbers and the numbers
that we start with so we don't spend money that we don't have.
[SPEAKER CHANGES]
Are there any other questions for the members of the committee?
Hearing none we're going to adjourn this meeting, we're all going to
comeback this afternoon at 1:30 for another hour and half of none stop
fun where we're going to discuss provisions to our budget, the
differences in provisions so we look for all of you back at 130 pm this
afternoon thank you meetings adjourned.